The row over ownership of the islands has been rumbling for years and has flared sporadically. This time, it has led to anti-Japanese protests in several Chinese cities.

'Fishing rights'

Japan's Vice-Foreign Minister Chikao Kawai arrived in Beijing on Monday for two days of talks.

"Because of the current difficult situation, I plan to explain what Japan is now considering to Zhang Zhijun and listen to what China is considering, for the importance of the relationship between both countries," he said ahead of the talks.

The statement posted on the Chinese Foreign Ministry did not quote any comments from Mr Kawai. But it quoted Mr Zhang as telling him that Japan needed to mend its ways.

"China will never tolerate any unilateral actions by Japan that harm Chinese territorial sovereignty," it said.

"Japan must banish illusions, undertake searching reflection and use concrete actions to amend its errors, returning to the consensus and understandings reached between our two countries' leaders."

The Japanese government moved to buy the islands in response to a potentially much more provocative plan by right-wing Tokyo Governor Shintaro Ishihara to buy and develop them using public donations.

The row comes at a time when both China and Japan are facing political changes domestically, making it difficult for either side to be seen as backing down.

Analysis

By Cindy SuiBBC News, Taipei

Taiwan believes the islands have historically been part of its territory, under the jurisdiction of its northern county of Yilan. Taiwanese fishermen consider the surrounding waters their traditional fishing grounds.

Taiwanese feel that Japan unfairly annexed the islands in 1895 at a time when China was weak. Many here believe the islands were returned to Chinese sovereignty when Japan surrendered at the end of World War II. Both China and Taiwan say they are the official holder of Chinese sovereignty over the islands.

But Taiwan's hands are tied. It cannot afford to hurt relations with Japan - a major trade partner and friend in the region, especially because China has hundreds of missiles targeting the island to warn it against declaring formal independence.

Taipei also cannot join hands with Beijing to assert claims to the islands because that would upset Washington and Tokyo, while hurting its own claims of being a sovereign country.

So President Ma Ying-jeou has proposed putting aside the territorial dispute and having all sides agree a code of conduct and start dialogue on jointly sharing the islands' resources.

Japanese Prime Minister Yoshihiko Noda's government - already hit by poor figures in opinion polls - is likely to face an election in coming months. China is due to hold a party congress in weeks that will see major changes in the top echelons of leadership.

A ceremony to mark 40 years of ties with Japan - due on Thursday - has been put off. Last week, several major Japanese companies briefly suspended operations in China after attacks on shops and car dealerships.

'Fishing rights'

Both China and Taiwan say they have inherited historic sovereignty over the islands. A flotilla of fishing boats sailed from Taiwan on Monday to protest over the issue.

A spokesman from Taiwan's Coast Guard Administration told the BBC 58 fishing vessels arrived in the disputed waters at around 05:00 local time on Tuesday (21:00 GMT Monday), accompanied by several Taiwanese coast guard vessels.

Japan's coast guard said warnings were issued to the boats and television footage showed water being sprayed towards the Taiwanese ships.

The flotilla turned back towards Taiwan after being in the area for a few hours, reports said.

The move to sail to the disputed area, activists and fishermen said, was to protect fishing rights and access to traditional fishing grounds.

"Fishing rights are more important than sovereignty, but fishing rights also means sovereignty (in this case),'' activist Chen Chunsheng, who is organising the flotilla, told reporters on Monday.

''So for this day on which we negotiate fishing rights, we are willing to be the backing of the government.''